Patni Q4 net income dips 12% y-o-y

Mumbai-based Patni Computer Systems reported a dip of 12 per cent in its net income at Rs 99.7 crore for the fourth quarter ended December 31, 2007. Its net income was Rs 113.49 crore for corresponding quarter last financial year.

The company's revenue for the quarter at Rs 686.19 crore was up marginally by 0.83 per cent from Rs 680.49 crore in the corresponding quarter last financial year.

Sequentially (quarter-on-quarter basis), net income was down 9 per cent from Rs 109.7 crore""and revenue was up 1.8 per cent from Rs 673.57 crore.

The company posted net income of Rs 449.18 crore for the year ended December 31, 2007""a 71.8 per cent increase over last fiscal's figure of Rs 261.36 crore. Its total income of Rs 2,612.5 crore for the year ended December 31, 2007, was a 2.3 per cent rise over last fiscal's Rs 2,553.3 crore.

For the full year 2007 the total foreign exchange gain stood at approximately $23.4 million (Rs 92.0 crore) contributing 3.5 per cent to operating margins during the year as against a loss of $ 2.7 million (Rs 12.12 crore) in 2006.

At the end of the fourth quarter of calendar year 2007 the company had overall forex hedges for $ 249.2 million.

In terms of future outlook the company expects a flat growth in revenues for the first quarter of 2008.

It estimated revenues to be at $175 to $176 million and net income (excluding the foreign exchange gain/loss) is expected to be in the range of $15.5 to 16.0 million taking the operations at a constant dollar value of Rs 39.40 per dollar.

"We are factoring in a one time payment of $5 million in the first quarter. This is due to one time visa cost of $3 million. Besides we have announced repricing of outstanding employee stock option for which we have factored in $2 million cost. Besides the first quarter is seasonally slow in comparison to the other quarters," said Surjeet Singh, Chief Financial Officer, Patni.

For the year total other income was higher at $17 million (Rs 67.09 crore) as compared to $12.5 million in 2006 due to increased interest and dividend income on investments.

Narendra K Patni, chairman and CEO, Patni Computer Systems, said, " In 2007, we have grown profits by managing our operations including forex changes very well. This highlights our ability to deliver sustained growth by focusing on improving internal operations while increasing our reach to customers worldwide. Overall as the market dynamics are changing, including our customer mix , we remain confident about our business momentum and continue to further expand the focus on improving internal efficiencies."

In the quarter the company added 37 clients, on the calendar year basis it acquires 119 new clients. The number of active clients was 318 at quarter end as compared to 293 in third quarter of 2007 and 239 at the end of 2006.

The company recommended an annual dividend of 150 per cent. The board of directors approved a share buy back programme in open market purchases on the Indian Stock Exchanges prices upto Rs 325 per share for a total purchase upto $60 million. It also recommended repricing of outstanding employee stock options at current market price.